ECONOMY

Greece a hub in SE Europe

Greece is developing into an international investment center for all of Southeastern Europe, a region which is seeing a spurt of economic growth, a study released yesterday says. «The restoration of stability and fast economic growth in the area attract international capital and multinational companies. As the countries in the region are small on the whole, international investors treat the region as a whole. And there is no country more appropriate in the region than Greece to serve as a base for such business initiatives,» said the study by the Panhellenic Exporters’ Association (PSE), which is titled «Trade Transactions and Greece’s Position in SE Europe (1995-2006).» The study dispels fears that the entry of Greece’s two neighbors into the EU and the fast development of all countries in the region will make them strong competitors of Greek products and the country’s broader economic interests. «Greece’s position in the Southeastern Europe of 56 million people and of fast economic growth is strong and becomes even stronger with the entry of Bulgaria and Romania into the EU,» the study said. «Such fears are excessive… On the basis of current rates of economic growth, these countries will need to 20-40 years to reach Greece’s level.» The study notes that the per capita income of the latest two entrants to the EU, Bulgaria and Romania, was a little over one-fifth of Greece’s in 2005. Growing trade The region’s countries occupy a prominent position in Greece’s trade and more than 3,000 Greek firms have invested about $14 billion in them. At the end of 2006, the number of branches of banks that are 100 percent Greek owned or are controlled by Greek banks was 1,100 in Bulgaria and Romania alone, and 1,600 in the whole of Southeastern Europe, according to the study. Greece’s trade with these countries grew 116 percent as regards exports and 159 percent as regards imports in the 1995-2006 period. The value of exports grew to $2.68 billion and of imports to $1.73 billion. Bulgaria, in particular, is Greece’s largest export customer in the area, absorbing $1.01 billion worth in 2006, or 5.9 percent of all Greek exports. Romania follows, with 508 million. According to World Bank figures, foreign direct investment in Southeastern Europe rose from $4.6 billion in 2002 to $10.6 billion in 2005. Exports from the region almost tripled between 1995 and 2006, from $19.7 billion to $55.7 billion, while imports rose more steeply, from $27.8 billion to $91.6 billion.